Many organizations are facing an impending loss of leaders as the last of the baby boomers are preparing to leave the workforce. With the start of a new decade upon us, now is the time to plan for the next generation of leaders. But where to start?
If your company does not have a leadership development program in place, or if you haven’t given much thought to how your company will make an orderly transfer of leadership responsibility, 2020 is the year to focus on this critical planning.
Below are the first three steps in succession planning. To avoid becoming overwhelmed, address them slowly over the next six to 12 months. Then, your organization will be ready to smoothly transfer the reins of leadership as the boomers in your company begin to retire.
1. Consider Who Is Next in Line for Leadership
The outcome of this initial step is to determine where you want to concentrate your leadership development efforts in order to achieve the most return on your investment (ROI). Do you want to focus on the individuals who have been with your organization the longest and, therefore, understand its inner workings and culture? Or, do you want to concentrate on members of younger generations who are looking for professional development as a primary perk of employment and who may be with your organization longer as a result?
To gain better insight, look at whom you presently employ and which generational cohort they belong to. Currently, there are four generations in most workplaces: the boomers; Generation X; the millennials and Generation Z, who are just entering the workforce. It is logical to assume that Gen X, being the next generation after the boomers, would be next in line to lead — but there aren’t enough of them. In fact, many members of Gen X have been stymied from moving up the corporate ladder by boomers, who have stayed on the job longer than previous generations.
The bottom line is that there are a number of generations in your workforce who have not participated in leadership development or been promoted into leadership roles. Determining where to apply development efforts is a critical first step in determining your company’s leadership pipeline. It’s best to develop everyone as if he or she were a future leader; a rising tide lifts all boats, after all.
2. Determine Which Skills Your Future Leaders Need
Once you determine whom you develop you’ll need to identify the skills they will need to support your organization in the future.
To accomplish this goal, there are three sources of data you’ll want to collect and consider. First, look at the job descriptions of each of your current leadership roles to determine which skills are necessary in today’s environment. These skills are just a baseline, as we know that today’s business environment is accelerating and changing at a pace never experienced before. What your organization needs today may not be what it needs tomorrow.
Be sure to identify leadership skills and behaviors, such as managing teams or fiscal responsibility, and not job tasks, such as monthly reporting. If possible, read between the lines. For instance, the task of “standardizing procedures to improve efficiency” really means having the leadership skills of analyzing, forecasting and planning.
Second, pay attention to what industry experts and your professional association are saying about the future of work and what they predict for your industry. Some of the current concerns include artificial intelligence (AI) and robotics, consumer pressures, and changing buying habits — all of which will require your company to adapt. How do you need to prepare your future leaders today?
Finally, hold one-on-one interviews with your current leaders, and ask them what prepared them for the role they hold today. Most often, formal development is not credited as much as mentorship, on-the-job learning, and a wide array of other informal and social learning experiences. These insights will help you determine the best course of leadership development for your organization going forward.
For example, you could put four future leaders through an off-site leadership development program, or you might choose to institute a job rotation program for everyone at your company. The two options might cost the same, but they will likely return vastly different results. Thoughtfully consider how people truly learn leadership in your organization.
Be concerned if the majority of responses are, “I learned it at my previous job.” That statement means you are doing nothing to develop leaders in your organization and are, instead, relying on other companies to develop them and hoping you can then hire them away. This “strategy” puts your company in a precarious position — the topic of another article entirely.
3. Consider How You Will Develop Future Leaders’ Skills
Once you have identified the skills that your future leaders need, you’ll need to determine how to help develop them. Creating a formal leadership development program is a time-consuming and arduous process, which is why so many companies forego it and, instead, cross their fingers and hope leaders will appear when needed.
Sending people to outside leadership development courses can be expensive, so the number of individuals who participate is generally far fewer than is needed. A smart option for most companies is to mete out leadership development to everyone through easy-to-implement activities such as reading groups or lunch-and-learns and on-the-job projects such as participation in multidisciplinary initiatives. Over time, small and consistent development opportunities will build the leadership skills your organization needs and alleviate succession planning concerns.
Once you have considered and acted upon these first three steps in succession planning, you’ll be well on your way to ensuring that your company has a leadership pipeline capable of continuing excellent work despite a rapidly changing business environment.